Wheaton Nat. Bank v. Dudek

• Decision Date: 24 April 1978
• Docket Number: No. 76-597,76-597
• Parties: , 17 Ill.Dec. 487 WHEATON NATIONAL BANK, a National Banking Association, Plaintiff, v. James W. and Angela M. DUDEK, Defendants and Third-Party Plaintiffs-Appellees, v. FOREMOST INSURANCE CO et al., Third-Party Defendants and Fourth-Party Plaintiffs-Appellants, v. Robert GRAHAM and Robert Graham Insurance Agency, Fourth-Party Defendants.
• Court: United States Appellate Court of Illinois

Page 633

376 N.E.2d 633

59 Ill.App.3d 970, 17 Ill.Dec. 487

WHEATON NATIONAL BANK, a National Banking Association, Plaintiff, v. James W. and Angela M. DUDEK, Defendants and Third-Party Plaintiffs-Appellees, v. FOREMOST INSURANCE CO et al., Third-Party Defendants and Fourth-Party Plaintiffs-Appellants, v. Robert GRAHAM and Robert Graham Insurance Agency, Fourth-Party Defendants.

No. 76-597.

Appellate Court of Illinois, First District, First Division.

April 24, 1978.

Crooks, Gilligan & Kages, Chicago, for third-party defendants and fourth-party plaintiffs-appellants.

Michael J. Dudek, Chicago, for defendants and third-party plaintiffs-appellees.

McGLOON, Justice:

This is an appeal from a judgment in favor of James and Angela Dudek and against Robert Graham and Robert Graham Insurance Agency for damages sustained as a result of Graham's alleged negligence in failing to obtain insurance upon two snowmobiles and a trailer owned by the Dudeks.

On appeal Graham argues (1) that the terms and conditions of the Dudeks' alleged contract of insurance were not proved at trial and thus the Dudeks may not claim the benefits of such a contract; (2) that the instant case is a case in malpractice and the Dudeks failed to introduce any testimony concerning the applicable standard of care in the profession; and (3) that the proper measure of damages is the fair market value of the items immediately before the loss and the Dudeks failed to introduce any evidence on that issue.

We affirm.

The testimony at trial established that on December 21, 1972 James Dudek purchased two snowmobiles and a trailer for transporting the snowmobiles for a total purchase price of $2,862. The testimony further indicated that on February 20, 1973 Dudek met with Robert Graham of the Graham Insurance Agency and discussed insuring the above items. At that meeting Dudek filled out an application for a $25,000 policy for liability, comprehensive and collision insurance to the Foremost Insurance Co., Inc. (hereinafter referred to as Foremost), and wrote a check for $120 payable to the Foremost for the premium. Dudek testified that Graham told him on February 20, 1973 he was insured and that the check for $120 was for the entire year's premium. Graham denied telling Dudek that he was insured as of that date.

On February 26, 1973 the snowmobiles and trailer were stolen in front of the Dudeks' home. James Dudek testified that he went to Graham's office the following day and informed Graham of this fact and that Graham again told him the items were insured. Supportive of the above testimony is that of James Dudek's wife, Angela, who testified that on approximately February 27, 1973 Mr. Graham's secretary called her and informed her that her husband had just left Mr. Graham's office. During that telephone conversation, the secretary informed Mrs. Dudek not to worry about the snowmobiles because they were covered completely.

On or about February 28, 1973 Graham received a letter from Foremost advising that in order to obtain a policy covering physical damage, the coverage had to be upgraded to $100,000. Graham testified that the letter was his first knowledge of such a requirement on Foremost's part. With Dudek's consent, Graham prepared a new application bearing the date February 20, 1973 and resubmitted it along with a check for the premium. On March 9, 1973 Foremost advised Graham that he had paid the gross premium ($136.85) and that upon receipt of the net premium ($131.75) a policy would be issued. Graham testified that the first time he told Dudek he was covered was after the March 9, 1973 communication with Foremost. Although Graham issued a check for the net premium, Foremost returned all the papers and rejected coverage on November 1, 1973.

After hearing all of the evidence, the trial court found for the plaintiffs and against the defendant in the amount of $2,662, the cost of the two snowmobiles and trailer, less a $50 deductible on each item.

Defendant first argues that to recover the benefits of a contract for insurance, plaintiff must prove the terms and conditions of that contract. Although that may be true, what is at issue here is not a contract of insurance, but a contract to procure insurance and we believe the essential elements of a contract to procure insurance were proved in the instant case. As indicated in Gothberg v. Nemerovski (1965), 58 Ill.App.2d 372, 208 N.E.2d 12, 18-19:

" 'It is sufficient if one of the parties to such a contract proposes to be insured and the other party agrees to insure, and the subject, the period, the amount and the rate of insurance are ascertained or understood, and the premium paid if demanded.' Cottingham v. National Mut. Church Ins. Co., 290 Ill. 26, 32, 124 N.E. 822, 825 (1919)."

Also, preliminary contracts to insure may be proved by parol as well as written evidence. (Pimentil v. Milo Brooke, Inc. (1956), 11 Ill.App.2d 201, 136 N.E.2d 608.) When Dudek's testimony is considered together with the written application, all of the above prerequisites to procure insurance were proved in the instant case.

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